Seen in the Political Insider blog at ajc.com:
Having ingratiated himself with a certain House Republican leader by opposing a payday lending bill, state Insurance Commissioner John Oxendine is now picking on a Senate motor insurance bill that he says would cost Georgia consumers an extra $400 million a year.[.]
S.B. 276, sponsored by Sen. Cecil Staton (R-Macon), would prohibit insurance companies from using the other guy’s insurance policy to reduce what they pay out on uninsured motorist claims.[.]
Say you’re in an accident caused by the aforementioned other guy, who has the $50,000 limited coverage. You have $100,000 in uninsured motorist coverage. The damage is $125,000. So you’re good, right? Not exactly.
The insurance backs out the $50,000 provided by the other guy from its limit, and pays the policy-holder only $50,000, leaving that motorist $25,000 in the hole.
This legislation would prevent insurance companies offering uninsured motorist coverage from doing that.
I’ll admit, the mechanics of UM/UIM coverage can be a little odd, particularly since the specifics of the coverage can vary from state to state. (For example, in Connecticut you can elect “standard” UM which operates as described in the article above, or “conversion” UM which operates as Georgia S.B. 276 would decree.)
However, this is something that ought to be taught alongside the basics of household budgeting and personal finance, and it’s something that your insurance agent (or the coders at your insurer’s website) should be reminding you of.